Budget 2012: Exemption up to Rs 2 lakh for taxpayers

Finance Minister, Pranab Mukherjee, has proposed an exemption of upto Rs 2 lakh for taxpayers. 10% tax rate has been proposed for income between Rs 2-5 lakh. The upper limit of 20% tax slab to be raised to Rs 10 lakh.  

This is what Pranab Mukherji had said in his Budget speech in February 2011.

I propose to enhance the exemption limit for the general category of individual taxpayers from Rs 1,60,000 to Rs 1,80,000 this year. This measure will provide a uniform tax relief of Rs 2,000 to every taxpayer of this category. Senior citizens deserve our special attention. For them, I propose

- To reduce the qualifying age, from 65 years to 60 years;

- To enhance the exemption limit from Rs 2,40,000 to Rs 2,50,000;

- To create a new category of Very Senior Citizens, eighty years and above, who will be eligible for a higher exemption limit of Rs 5,00,000.